00:00Claudia Sam of New Century Advisors writing Walsh has managed to make the Fed an even bigger focus
00:04of attention by saying less. Uncertainty around economic policy was already high.
00:09The last thing we need is the Fed adding to it. Claudia joins us now for more. Claudia,
00:14welcome to the program. Do you think that Chair Walsh is contributing to the kind of
00:18volatility that might be harmful? So we are seeing that Chair Walsh is
00:23contributing to volatility. Now, where it's most clear is in the federal funds futures market,
00:28right? So coming in yesterday, there was still about a 30% chance of a rate hike today. That
00:33may not sound like much, but that is very high for that close to a meeting. The only time we
00:39have
00:39seen uncertainty like that in the past several years have been big moments like liftoff in 2015
00:45or the first rate cut in 2024. There was a lot of economics going on and lots of disagreement on
00:51the committee. This time, the uncertainty that comes from a chair who has gone really low information
00:57on how he's thinking about policy. Low information on a range of things. And Claudia,
01:01you pointed out the difference. It's OK to stop providing forward guidance. But he's also failed
01:06to articulate his reaction function. What kind of questions do you have for this news conference?
01:12I think one is just to ask Kevin Walsh about his own past words. When he worked on the Bank
01:17of England's communication review in 2014, he recommended that they give timely feedback on
01:23what the decision was, the rationale for the decision. And he even talked about the importance
01:28of a reaction function. So what's changed? That's been over a decade ago, and his thinking could have
01:33changed. But I agree with that Kevin Walsh about how he thinks about communication. And I'm having a
01:39hard time with it in this moment, though I will say we got all of that information by the time
01:45we got
01:45to the June FOMC minutes. So it may just be Kevin Walsh wants to change the format we get the
01:50information, not necessarily that we get less information. I think it'd be a really good idea
01:55to at least get it into the statement today if he doesn't want to say it in the press conference.
01:59Claudia.
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